Microsoft Clubs Counterfeiters

Microsoft is once again after resellers hawking counterfeit Microsoft goods worldwide.

In the past several weeks, the software giant has filed 52 lawsuits against resellers who allegedly sold counterfeit Microsoft software on various online markets. Fifteen of the 52 lawsuits involved software traced to a Chinese counterfeiting syndicate, broken up earlier this year by Chinese authorities, the FBI and Microsoft said. Investigations by Microsoft revealed that the counterfeit software produced by the group was distributed in some markets through domestic online sellers. The company referred 22 of the cases to local law enforcement in various countries.

Microsoft customers played a prominent role in the takedown by helping to identify the counterfeiters by filing reports with Microsoft after anti-piracy technology in Windows Genuine Advantage indicated that their software was bogus.

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"In 19 cases we followed up directly on reports we received from customers through the Microsoft Web site or from the 1-800-RU-LEGIT hotline where customers can report suspected piracy after failing WGA validation," said Matt Lundy, senior attorney at Microsoft. "In other instances, we were made aware of the counterfeit seller through our test purchase program."

It is not uncommon for consumers seeking genuine software online to purchase fraudulent software unwittingly, Microsoft said. But cheap counterfeit software can come with a high, hidden price—malware, spyware and other malicious code are often contained within them.

"With today's announcement, we released a Microsoft Buying Guide to act as an educational resource for consumers and merchants to avoid counterfeit," Lundy said. "The Microsoft Buying Guide on eBay points consumers and merchants to actions they can take to protect themselves from the risks of counterfeit software. The guide can be found at eBay and at Microsoft."

Microsoft is not the only major company taking the offensive against counterfeiters. Earlier this year, Symantec announced it had filed eight separate lawsuits in U.S. District Court in California, seeking more than $55 million in damages from the companies Symantec officials said pirated the corporation's software.

Globally, piracy costs the software industry an estimated $40 billion per year, according to a study by the Business Software Alliance and analyst firm IDC. Lost industry revenue, however, is just the beginning; the same report estimated the worldwide PC software piracy rate at 35 percent in 2006.

"Counterfeit software is known to pose a number of risks to consumers and Microsoft takes seriously its responsibility as an industry leader to inform consumers of those risks and to help them avoid it," Lundy said.

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